• Registered: 06/10/2010
  • Posts: 4

Topic: How to Set up

Hi,

We have Service Tax in India. and it is 10.3 % on service Rendered.
We collect Service Tax from customers and deposit to goverment and at the same time we can exemption for service tax payed ie

If we get service from A we pay him Service Tax  and the same service We charge it to B at higher rate we collect Service tax from him
But get credit for tax paid by us ( it is returned by govt after some time)

how do we account it in front accounting

thanks

  • Registered: 12/25/2007
  • Posts: 2,448

Re: How to Set up

I think you can define the service as two items: once as taxable item, and once as tax_exempt.Then you can put two lines on invoice: first using exempt item on amount which was purchased form  A, and second using taxable item for the rest of amount sold.
I'm not sure if this way is satisfactory for you, but there is a couple of guys from India on the forum, so maybe they can point you out the better solution.
Janusz

  • Registered: 09/10/2011
  • Posts: 1

Re: How to Set up

Hi, did you get it setup? If yes, how?